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A team of industry heavyweights has backed a $21.5 million investment in Zanaga Iron Ore (LON: ZIOC), injecting fresh momentum into one of the world’s largest untapped iron ore deposits. The financing could rise to $23 million depending on additional subscriptions.
Industry Leaders Join Forces
The deal brings together some of the mining sector’s most influential figures, including former Anglo American (LON: AAL) CEOs Mark Cutifani and Tony Trahar, along with Mick Davis, the former Glencore (LON: GLEN) and Xstrata boss now leading Vision Blue. Other key investors include private equity firm Greymont Bay, Heeney Capital, and industrial developer Gagan Gupta, founder of Arise.
Their involvement could provide the long-delayed Zanaga project with the push needed to move beyond the planning stage.
Shares in Zanaga Iron Ore surged 8% to 11p, raising the company’s market capitalization to £70 million ($89 million).
Strategic Investment for Project Advancement
“This transaction enables us to capitalize on our preparatory discussions with strategic partners and assemble a construction consortium for the Zanaga Project, aimed at unlocking the full potential of what we believe is the world’s most compelling undeveloped iron ore asset globally,” chairman Clifford Elphick stated.
Buyout of Glencore’s Stake
Zanaga will allocate $15 million from the funds to acquire Glencore’s 43% stake, severing long-standing ties with the commodities giant. This move ends Glencore’s marketing rights to future production and removes its representative from Zanaga’s board.
The remaining funds will sustain project operations over the next year, advance feasibility studies, and initiate a formal bidding process to assemble a construction consortium for the planned 30-million-tonne-per-year iron ore mine.
Market Challenges: Iron Ore Prices Decline
The announcement comes as iron ore futures continue to decline, with prices falling for a sixth consecutive session due to escalating trade tensions between the U.S. and China.
The most-traded May iron ore contract on the Dalian Commodity Exchange dropped 2.81% to 779.5 yuan ($106.91) per tonne.
The benchmark April iron ore contract on the Singapore Exchange fell 2.53% to $99.85 per tonne.
Market sentiment was further dampened by speculation that China may cut crude steel output by 50 million tonnes in 2025, adding additional pressure on iron ore prices.
